A detailed report presented to the Council Executive this week set out the financial challenges facing the council and explained how wider government decisions directly impact local services in West Lothian.

The report highlighted that the council is legally required to set a balanced budget each year – meaning its spending must not exceed its income. However, insufficient funding has left West Lothian facing a budget gap of £34.9m over the next three years, including nearly £12m of savings required this year alone.

By 2028, the council will have made savings of more than £207m since 2007 in order to maintain balanced budgets. Council officers have now been instructed to identify additional savings options to address the latest shortfall.

The financial update followed the UK Chancellor’s 2025 Spending Review in June, which set out government funding plans until 2029. Shortly afterwards, the Scottish Government published its updated medium-term financial strategy, setting out its own priorities for the next five years.

Both documents underline a difficult outlook for public spending. While the Scottish Government has set a framework for managing its resources, spending demands are expected to grow more quickly than available funding between 2024/25 and 2027/28 – creating a structural gap.

Adding to the challenge, the UK economy has slowed compared to forecasts made in October 2024, with GDP growth now expected at just 1% this year. Rising European energy prices, increased defence spending pressures, and tighter global trade restrictions have all contributed to a weaker fiscal outlook.

Given these conditions, West Lothian Council stressed the importance of maintaining a robust approach to financial planning. The council’s strategy aims to ensure that services continue to deliver outcomes for communities while meeting the legal requirement to balance its budget.

Council officers will continue to monitor UK and Scottish Government announcements and provide updates to future meetings of the Council Executive on the local impact.